However, The Post's parent company, News Corp, will not be part of the legal proceedings, as the judge granted its motion for dismissal.

In a statement from the New York Post, the paper's management said: "We look forward to presenting the truth about the remaining charges - which are completely unfounded - to a jury."

Allan spent three months in Australia at his former stomping grounds – the Murdoch empire's Holt Street bunker in Surry Hills – in the lead-up to the federal election. He was dispatched to provide "editorial leadership" for the media conglomerate's suite of tabloids.

His return to Australia was heralded by a run of controversial front pages that threw Rupert Murdoch's considerable weight behind Tony Abbott's ultimately successful campaign for the prime ministership.

Allan, who returned to New York a fortnight ago, is due back in Australia to attend Friday night's News Awards in Brisbane, an in-house staff competition launched as an alternative to the industry-wide Walkleys.

Allan, a former editor of The Daily Telegraph, and the New York Post also face allegations by Guzman that she was repeatedly harassed in the newsroom and eventually fired for speaking out against a highly controversial cartoon about President Barack Obama, depicting the author of Obama's stimulus package as a chimpanzee shot dead.

She also claims senior management at the Post had fostered a hostile work environment for minorities like herself - a black, Puerto Rican woman - and that Allan showed her and other colleagues a picture on his phone of a "naked man lewdly and openly displaying his penis", while other editors and colleagues repeatedly used misogynistic or racist language.